India’s Digital Economy

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India’s Digital Economy: India's digital economy has been growing rapidly over the last decade, positioning the country as the third largest digitalised economy globally.

  • About: The digital economy is the use of digital technologies to create, market, and consume goods and services. It's a term that describes how the internet and World Wide Web are transforming traditional economic activities.
  • Digital Economy's Current Share: Accounts for 11.74% of GDP (INR 31.64 lakh crore or USD 402 billion in 2022-23).

o Employs 14.67 million workers (2.55% of the workforce).

o The sector is nearly 5 times more productive than the rest of the economy.

  • Expected Contribution: By 2029-30, the digital economy is projected to contribute one-fifth of India’s national income, surpassing agriculture and manufacturing in share.
  • Key Growth Drivers: Rapid adoption of AI, cloud services, and global capability centers (GCCs).

o India hosts 55% of the world’s GCCs.

  • Digitalisation in Traditional Sectors:

o Over 95% of banking payments are digital, but loan and investment activities remain offline.

o Retail: Shift towards omni-channel models, with physical stores and AI-driven tools.

o Education: Adoption of offline, online, and hybrid learning models.

o Hospitality and Logistics: Full digitalisation in larger firms, AI and metaverse usage.

  • Workforce Impact: Digital economy employed 14.67 million workers, with 58.07% in digital-enabling industries.
  • Future Outlook: By 2030, digital economy’s contribution is projected to reach 20% of GVA.

o Digital platforms and digital-enabling industries are growing rapidly, with digital platforms expected to grow at 30% annually.



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